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 EU officials said Athens made an urgent plea for cash at a meeting
of deputy finance ministers in Brussels on Wednesday night but was
told there must first be progress on the stalled list of measures to
make its public finances sustainable.
"From the Greek side there was a strong statement that liquidity is
getting really bad and there was an appeal to release some type of
liquidity support before the euro zone finance ministers' meeting on
April 24," a euro zone aide said.
"But no one knows how this could be done -- there is no willingness
to provide support before there is some progress in terms of the
reform program," the official said.
Leftist Prime Minister Alexis Tsipras, elected in January on a
promise to end austerity, is balking at reforms of the pension
system and labor markets to which his conservative predecessor had
agreed.
Greece's creditors -- the euro zone and the International Monetary
Fund -- are using the leverage offered by its acute cash predicament
to press for those measures to be implemented.
A European Commission spokesman stressed the importance for Greece
of the finance ministers' meeting in Riga, telling reporters:
"Obviously, everything that happens before April 24 in terms of
reaching an agreement will be greatly welcome."
Athens submitted a 26-page list of planned reforms last week but
euro zone officials said they lacked key details and proper
assessments of the financial implications.
The officials said trust was so low that ministers would want to see
legislation going through the Greek parliament, not just promises,
before they released more funds.
Finance Minister Yanis Varoufakis, speaking in Paris, accused the
euro zone on Thursday of inflicting toxic medicine on his country,
and starving it of cash.
"Tragically we find ourselves today in a similar situation," he told
an economic conference. "As a finance minister ... in order to
create the liquidity which is necessary to see these negotiations
through hopefully to a sustainable solution, I have to make the same
request that we are allowed to issue T-bills over and above a
certain limit to create the liquidity necessary to see us through to
the end of the month or the next month or June, so as to be able to
redeem payments to the former troika -- to the IMF in this case."
SECRET MEMO
A Greek official said Athens would pay the 450 million euro ($485
million) loan installment to the International Monetary Fund later
on Thursday. It is scraping together cash reserves from state bodies
to pay wages and pensions due this month.
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Separately, the policymaking governing council of the European
Central Bank was holding a teleconference on Thursday to decide
whether to extend and increase emergency liquidity assistance for
Greece's banks, which have suffered big deposit outflows in the last
four months.
A secret memorandum drafted by the Finnish Finance Ministry, one of
the most hardline creditor countries, raised the prospect of Greece
effectively being pushed out of the euro zone if fails to meet
obligations under its 240 billion euro international bailout
program.
The newspaper Helsingin Sanomat quoted the memo, dated March 27, as
saying Finland must be prepared for the possibility that Greece
would run out of cash before the end of June.
That could lead to a situation where "by silent approval of the
other euro zone countries a process is started which in effect
results in Greece being expelled from the euro", it said. The
finance ministry was not available for comment.
On the second day of a visit to Russia, Tsipras said in a speech at
Moscow University that Russia could not provide an alternative
"solution" for Greece's debt problems to negotiations in the euro
zone framework.
But he called on the European Union to restore dialogue with Moscow
despite differences over Russia's role in Ukraine.
"It is impossible to build European security without Russia, let
alone against it," Tsipras told students. "In this context, we must
... restart the EU-Russia dialogue in order to address global
challenges, energy cooperation and to promote mobility among
citizens."
(Additional reporting by Philip Blenkinsop and Ingrid Melander in
Brussels, Renee Maltezou in Moscow and Anna Ercanbrak in Helsinki;
Writing by Paul Taylor)
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